Yes, Everybody’s KPIs Are Screwed. But It’s Going to Be OK

Julian Baring Adform

Data-Driven Thinking” is written by members of the media community and contains fresh ideas on the digital revolution in media.

Today’s column is by Julian Baring, regional president of Americas at Adform.

The digital advertising identity landscape isn’t shifting. It’s shattering. And there’s not an ad tech company, brand, agency or publisher on the planet that isn’t going to feel the effects of the move into a privacy-first, cookieless world in some shape or form.

From an advertiser standpoint, just go ahead and throw all of your historical campaign data out the window. If you think it’s going to serve as a guidepost in the future, I’m here to deliver some bad news: The metrics you built your KPIs on are screwed. Historical data will be irrelevant in the new identity landscape, until these data sets are rebuilt based on the new future-state, one without third-party cookies.

But before you panic, I’m also here to tell you: It’s going to be OK. The digital advertising landscape will continue to thrive. We just have to hit the reset button on our expectations. Companies that prepare now will find the impact of this industry-wide control-alt-delete moment will be lessened, not just financially, but also mentally and emotionally.

We’ve been here before

The digital landscape has matured significantly over the past decade, but it’s useful to remember that we’ve been through upheavals before. The current seismic shift in identity reminds me of what we saw when programmatic advertising came on the scene. It meant something different to everyone. For some, it was an entirely new way of buying. For others, it was a new way to access ad network inventory. For others, it was a new way of thinking about data-driven advertising tactics. Remember when RTB meant “race to the bottom?”  But across the board, everyone shared a common challenge: They had no historical knowledge around which to base KPIs and benchmark success.

Right now, identity is in a similar state, with different parties focused on different challenges in the face of change. Some are focused on the implications of the loss of third-party cookies. Others are concerned most with what privacy-centric shifts mean for their first-party data. Others are fretting over their lack of such data and determining how they can acquire more of it.

Given this diversity of thinking and concern, it comes as no surprise that we’re seeing little consistency in how organizations prepare for the future identity landscape. Plenty of ad tech players are racing to offer alternatives to the third-party cookie, but no single alternate ID “to rule them all” exists—or is likely to emerge—at a level of propagation that’s going to offset the loss of third-party cookies.

Simply put, when the third-party cookie goes away, it’s not going to be seamless. Particularly for performance marketers, the KPIs that have guided campaigns to date – those built around CTR, CPA and the like – are going to erode significantly. In fact, the entire language we use to describe campaign effectiveness in the future is going to evolve.

Preparing for the reset 

The forthcoming KPI reset is going to be hardest on marketers with sophisticated media mix modelling in place. After all, these practices rely on and build upon historical data, and we’re about to flush all historical data down the cookie toilet. So, what can marketers do to prepare? Here’s my best advice:

1. Test and learn where you can. It’s true that Chrome hasn’t turned off third-party cookie support yet, so the desire to salvage every crumb possible is understandable. But while you do, start running some tests in environments like Safari and Firefox, which already operate in a cookieless manner. How your campaigns perform there, where new identifiers are already in play, will give you a sense of what to expect in 2022 when Chrome hits the off switch.

2. Start to manage expectations now. The fact that much of the C-suite is unaware of the forthcoming digital identity earthquake means that few organizations are preparing their reporting and feedback loops accordingly. It’s up to marketing leaders to help them understand why previously reliable ROI dashboards are about to dissolve before everyone’s eyes. The sting will be greatly diminished if everyone knows the shot is coming.

Above all, now is the time to ask a lot of questions and start letting go – strategically and emotionally – of yesterday’s success measures. It’s not that your campaigns aren’t going to be effective in the future. It’s simply that how that success is gauged needs to be fundamentally restructured. With early preparations, you can lessen the impact felt in both your dashboard and your boardroom.

Most important of all, seek to get as much granular data as you can now and into the future so that you don’t just take your partners word for campaign success. As cookies continue to deprecate, marketers will need to rebuild campaign KPI metrics from the ground up. Accessing log-level data and then mining that data now and continually over the next 18 months will give you the raw insights to revalidate campaign effectiveness.

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